Q: If we require our employees to be on call, do they need to be paid overtime if this extends their 40-hour work week?
A: No; that is, unless they are actually called out from their home. Being at home on call doesn’t require you to pay OT, but it would when they are called out, of course. If, for some reason, they are required to be at work (or a work location) on call, then yes, that would be OT for the time they spend waiting around. “Engaged to wait” versus “on call” are considered different situations. Most of our members will pay a flat fee to those who are on call during the week or over the weekend for making the sacrifice to be available for work. What has caused problems is when that fee relates to extra hours worked. If they mark down extra hours, that it is OT above their normal, 40-hour work week. An approach some use is to shorten the work week by the corresponding number of hours for those on call, which results in the compensation coming out the same. Employees would generally prefer OT for this. Another approach is a bonus for the number of times they were on call.
Below is a great website that covers pretty much all of the wage and hour requirements. Remember, some states have slightly different laws … and then there is California, of course. — CW
More information: http://www.dol.gov/whd/flsa/index.htm